Posted on by Stephanie Maracayo

STEPHANIE MARACAYO

Discussion 5.2

M-C-M explains how capitalist keep and increase their wealth, M is for money because they start with an amount of money. C is for commodity because they use the money they have to purchase materials, farms, factories and labor workers in order to produce goods and services. M is for more money because once the goods and services are selling the capitalist receives more money than the money they started with. The M-C-M shows how capitalist increase money such as investing, production and selling their goods and services to receive more money.

Posted on by Osama Farooq

Discussion board 5.2- Osama Farooq

The M-C-M’ model shows how capitalists increase their wealth. It starts with Money (M), which is used to buy Commodities (C), like factory machinery or raw materials. These are turned into new products, which are then sold for more Money (M’). Profits are made by paying workers for less than the value of what they produce. The portion of labor that generates value beyond the workers’ compensation is called surplus labor, which turns into profits for capitalists. For example, let’s say the capitalist spends $100 on cotton and in hiring workers to turn this cotton into T-shirts. Once these T-shirts are made, they are sold for a higher price, let’s say $200, turning the initial investment into more money (M’). This profit of $100 is what’s called surplus value. The capitalist then reinvests some or all of this profit into buying more commodities, like more cotton or better machines, continuing the cycle. This ongoing process allows the capitalist to keep growing their wealth, always ending the cycle with more money than they started, which is how they remain wealthy over time.

Posted on by Alizia

Discussion 5.2 : MCM’

The MCM movement of exchange was created not with the intention to consume items or goods personally, but with the intention to buy and resell at a higher value in order to gain profit. Capitalists are able to maintain and increase their wealth by using productive forces of the factory. As stated in Pierre Jalee’s “How Capitalism Works” capitalists use their buildings, machines and equipment, raw materials and labor power, which all costs money (M) to mass produce a certain quantity of manufactured goods. This is the commodity (C), to resell these manufactured items which are already valued at (M’) before they even leave the factory. Capitalists are able to sell them at a higher costs than it required to create and manufacture them through labor power of their employees. They are able to get maximum productivity out of one person in the 8 hour work day by paying them only a portion of what they would make in value in a day. The employee still has to be clocked in for the rest of their shift, causing the employee to perform unpaid labor also known as surplus labor. The product of surplus labor is surplus value, which is the product of capitalist exploitation. Without surplus value the capitalists could not have come into being, nor could they survive. This is how the rich stay rich, they exploit their employees for their time and have them produce as much as they can to make the owner of the companies more money.

Posted on by Arto Artinian · 1 Comment

Discussion Board 5.2

  1. As we learned thus far, the capitalist class consists of people who own wealth, as well as the means of production in American society. An important question in understanding how this class works is to ask: how does a capitalist remain wealthy? The answer to this question depends largely on understanding the diagram M-C-M’. So, let’s practice by explaining what happens in this diagram in our own words (but basing our ideas on Reading 5.1). Respond to the following question: Explain M-C-M’ to show how capitalists maintain and increase their wealth. (hint: your answer should weave a summary that includes what you reviewed in the self-assessment exercise question 1-7)